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Navigating the Insurance Landscape: Key Considerations for a Secure New Year
As the New Year unfolds, many South Africans should take the opportunity to reassess their insurance cover to ensure they are adequately protected against emerging risks. IntegriSure provides insights into five factors individuals should consider when reviewing their motor and home insurance policies. 1. Power Surge Cover and Load Shedding Protection South Africans have faced a challenging year, enduring over 330 days of load shedding in 2023, indicating a significant escalation in the country’s power supply crisis. In line with the frequency of unexpected power surges and load shedding in 2023, most insurers implemented significant changes to enhance their approach to power surge cover. These changes included: revised excess structures, policy wording changes, inclusion of definitions outlining what constitutes power surge, optional cover and limits, and in some instances the inclusion of waiting periods for new cover. It is therefore important to familiarise yourself with the policy conditions pertaining to your power surge cover and to understand the extent of cover you will enjoy during load shedding. 2. Cyber Cover: Safeguarding Against the Rising Threats In an era marked by escalating cyber threats, South Africa has become a primary target for ransomware and e-mail attacks. According to Surfshark’s Data Vulnerability Thermometer research, South Africa’s cyber-crime density – the percentage of cyber-crime victims among a specific number of internet users – has increased by 8% over the last year, placing the country in fifth position globally. Phishing and online payment fraud remain the most prevalent cyber-crimes worldwide. This alarming figure emphasises the importance of integrating cyber cover into insurance portfolios. We all know of someone that has been hacked or lost money to cyber criminals but many consumers are unaware that they can obtain insurance cover for themselves and their family on an individual basis. In line with the shifting cybersecurity risk landscape, cyber cover is not only essential but also affordable, and should form a crucial part of your comprehensive insurance portfolio. 3. Underinsurance: A Silent Risk IntegriSure warns against underinsurance, urging policyholders to annually review cover values to prevent being underinsured. The potential consequences are stark: a failure to increase your contents cover by a very reasonable 10% annually could result in a massive 61% underinsurance after just five years. The additional premium to accommodate for only a 10% increase in value is minimal. Also, don’t forget to ensure any new items purchased over the festive season are placed on cover. 4. Excess Structures: Understanding Financial Risk Do you know what your excesses are on your policies? All too often a cheaper premium comes with higher excesses. Going from a zero excess on your vehicle to a R20 000 excess can easily result in a 40% change in premium. You can adjust most policy excesses which remains an excellent tool to manage your risk depending on your personal circumstances and budget. 5. Risk Mitigating Services: Beyond Conventional Cover Understanding and managing insurance risks is complex. Different risks require distinct insurance products, and understanding each policy's nuances is crucial for adequate protection. As risks evolve, regularly review and update your strategy and cover to align with your current situation. Collaborate with an experienced insurance broker to help navigate policy complexities to ensure proper protection. Brokers should also play a key role in identifying and supporting non-traditional risk management solutions, incorporating elements like risk prediction and prevention. In conclusion, IntegriSure encourages individuals to review product options. Protect your hard-earned assets by consulting with your broker who will be able to provide you with options and recommendations for a suitable product to best suit your pocket and your needs.
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Broker Advice | Navigating the Insurance Landscape: Key Considerations for a Secure New Year
As the New Year unfolds, many South Africans should take the opportunity to reassess their insurance cover to ensure they are adequately protected against emerging risks. IntegriSure provides insights into five factors individuals should consider when reviewing their motor and home insurance policies. 1. Power Surge Cover and Load Shedding Protection South Africans have faced a challenging year, enduring over 330 days of load shedding in 2023, indicating a significant escalation in the country’s power supply crisis. In line with the frequency of unexpected power surges and load shedding in 2023, most insurers implemented significant changes to enhance their approach to power surge cover. These changes included: revised excess structures, policy wording changes, inclusion of definitions outlining what constitutes power surge, optional cover and limits, and in some instances the inclusion of waiting periods for new cover. It is therefore important to familiarise yourself with the policy conditions pertaining to your power surge cover and to understand the extent of cover you will enjoy during load shedding. 2. Cyber Cover: Safeguarding Against the Rising Threats In an era marked by escalating cyber threats, South Africa has become a primary target for ransomware and e-mail attacks. According to Surfshark’s Data Vulnerability Thermometer research, South Africa’s cyber-crime density – the percentage of cyber-crime victims among a specific number of internet users – has increased by 8% over the last year, placing the country in fifth position globally. Phishing and online payment fraud remain the most prevalent cyber-crimes worldwide. This alarming figure emphasises the importance of integrating cyber cover into insurance portfolios. We all know of someone that has been hacked or lost money to cyber criminals but many consumers are unaware that they can obtain insurance cover for themselves and their family on an individual basis. In line with the shifting cybersecurity risk landscape, cyber cover is not only essential but also affordable, and should form a crucial part of your comprehensive insurance portfolio. 3. Underinsurance: A Silent Risk IntegriSure warns against underinsurance, urging policyholders to annually review cover values to prevent being underinsured. The potential consequences are stark: a failure to increase your contents cover by a very reasonable 10% annually could result in a massive 61% underinsurance after just five years. The additional premium to accommodate for only a 10% increase in value is minimal. Also, don’t forget to ensure any new items purchased over the festive season are placed on cover. 4. Excess Structures: Understanding Financial Risk Do you know what your excesses are on your policies? All too often a cheaper premium comes with higher excesses. Going from a zero excess on your vehicle to a R20 000 excess can easily result in a 40% change in premium. You can adjust most policy excesses which remains an excellent tool to manage your risk depending on your personal circumstances and budget. 5. Risk Mitigating Services: Beyond Conventional Cover Understanding and managing insurance risks is complex. Different risks require distinct insurance products, and understanding each policy's nuances is crucial for adequate protection. As risks evolve, regularly review and update your strategy and cover to align with your current situation. Collaborate with an experienced insurance broker to help navigate policy complexities to ensure proper protection. Brokers should also play a key role in identifying and supporting non-traditional risk management solutions, incorporating elements like risk prediction and prevention. In conclusion, IntegriSure encourages individuals to review product options. Protect your hard-earned assets by consulting with your broker who will be able to provide you with options and recommendations for a suitable product to best suit your pocket and your needs.
Business Advice | Navigating Climate Challenges: The Strategic Role of Brokers in Risk Management
The frequency of severe weather incidents is increasing at an accelerated pace with infrastructure worth billions of rands continuing to be destroyed. Businesses are grappling with substantial financial losses, as they contend with soaring operational costs to maintain their operations and keep their doors open. This trend is evident in recent natural catastrophes, such as the 2017 Western Cape wildfires, the April 2022 KwaZulu-Natal (KZN) floods, and significant flooding in the Western Cape and along the Orange and Vaal Rivers in 2023. Climate change has become not only a social risk but also one of the biggest financial risks, impacting the national economy. While insurance cover has traditionally served as a safeguard for businesses facing losses from severe weather incidents, there are now emerging concerns and warning signs that could be alarming for businesses. Complex challenges The increasing occurrence and intensity of climate-related risks present companies with a new set of dynamic and complex challenges. As a result of the diminishing appetite of reinsurers to take on specific risks, particularly in regions prone to sever weather events, insurers are finding themselves shouldering a greater portion of the risks compared to the past, leading to a corresponding reduction in their risk appetite. This, in turn, directly impacts businesses. In the past, there were instances where insurers may have been lenient in terms of risk requirements, and in some cases even allowing clients to be non-compliant with a punitive excess. However, we are now observing instances where insurers are steadfast in their insistence on risk prevention measures, with little or no room for negotiation. While this is a prudent approach for insurers to appropriately manage risks, it carries significant and far-reaching financial implications for businesses. This was echoed by findings from a global customer survey, “The Value of Insurance in a Changing Risk Landscape,” that reveals insurance clients across the world’s six largest insurance markets are concerned about future insurability. Over 50% of respondents expect it will become more difficult or impossible to get insurance for natural catastrophes. Non-traditional risk management solutions needed As climate risks intensify, systemic risk grows, posing challenges to the conventional insurance business model. This could result in elevated premiums, rendering insurance either prohibitively expensive or, worse yet, inaccessible. It is our belief that the risk management landscape will undergo a profound transformation, with brokers assuming a central role in safeguarding businesses beyond merely securing appropriate insurance products but in proactively identifying and assisting with non-traditional risk management solutions. It is essential for brokers to provide services that go beyond conventional risk transfer, and incorporate elements such as risk prediction and prevention. Through leveraging their expertise to deliver comprehensive services addressing risk mitigation and fostering positive change, brokers can guide clients in developing robust risk management strategies to ensure uninterrupted business continuity.
Business Advice | Bridging the Gap: The Vital Role of Skilled Brokers in Cyber Insurance
Cybercrime has become one of the biggest risks to business continuity in South Africa yet many businesses are operating without the necessary cyber insurance policies in place, exposing themselves and their clients to significant financial and reputational losses. The reason why some businesses opt not to add cyber insurance cover to their portfolios might however come as a surprise to many. Obtaining cyber insurance can be a tedious and complex procedure for businesses, as it entails submission of a substantial volume of documentation necessary for insurers to assess and underwrite the associated risks. As a broker, in our experience, cyber cover is not the easiest cover to obtain for clients. Whilst we acknowledge and respect that insurers need to accurately underwrite risks, we also believe they should assist businesses in making this cover attainable. What type of insurance do you need? The type of insurance a company needs depends on the risk exposures relative to that particular business. The specifics of what is and is not covered by a policy will largely depend on the insurance provider, but across the board underwriters will review a company’s security protocols. This evaluation will encompass an assessment of preventative measures in place, such as email security, multi-factor authentication status, backup procedures, encryption, firewalls, and user training and awareness. It’s here where a broker plays a vital role in being the intermediary between the client and the insurer and especially assisting clients to provide all the required information to the insurers. The difference between cyber security and cyber insurance Another trend that we have identified is that some businesses confuse cyber security and cyber insurance. Cyber security refers to the proactive technologies, processes and practices aimed at protecting a company’s network, encompassing tools such as firewalls, antispyware software and Virtual Private Networks (VPNs). Cyber insurance helps cover the expenses and services a company needs after suffering a data breach or cyberattack. There are various cyber insurance cover options in the market including security and privacy liability, data recovery and loss of income, business interruption and loss of business income. Some cover options also include cover for legal expenses, a PR campaign to mitigate any reputational or brand damage, credit monitoring services, forensic auditors, customer notification costs, crisis management expenses, and costs in negotiating with hackers or paying ransom demands. Every business needs a cyber insurance policy One thing that can’t be denied is that every business needs a cyber insurance policy. According to Interpol’s 2022 Africa Cyberthreat Assessment report, South Africa leads the continent in the number of cybersecurity threats, with 230 million threat detections identified in 2022. South Africa saw a 100% increase in mobile banking application fraud and is estimated to suffer 577 malware attacks an hour. The concerning rise in cybersecurity crimes serves as a clear indication of a shifting risk landscape and highlights the need for knowledgeable brokers to educate businesses about the necessity and importance of integrating cyber cover into their insurance portfolios. Forge strong relationships with a trusted broker A skilled broker plays a crucial role in explaining the importance of cyber insurance to their clients. They bridge the gap between a business’s perception of their current cyber protection and the actual cover provided by a particular cyber policy, whilst also highlighting the comprehensive value such a policy offers. By forging strong relationships with a trusted broker, businesses can navigate the intricacies of risk management with confidence, knowing they have a dedicated partner who understands their unique needs and can offer tailored solutions for mitigating risks and ensuring uninterrupted business continuity.
Car Advice | Will increasing crime and resultant claims frequency lead to unaffordable vehicle insurance?
Whilst you might think that having a car with the latest high-end security features protects you, this is not necessarily the case as car thieves have become increasingly tech-savvy. Most modern cars include data aggregation systems such as Advanced Driver Assistance Systems (ADAS), On-Board Diagnostics (OBD) and telematics systems. These systems collect, combine, and manage various types of data generated within a vehicle. The very sensors, computers, and systems that were created to protect cars are now being used to steal cars. Advanced criminal techniques The Electronic Control Modules (ECMs) allow remote management of the engine, transmission, powertrain, brakes and suspension. However, criminals are now using this to their advantage to steal cars by using various hacking techniques to track a car’s credentials and data via the internet in order to gain unauthorised access and control over the vehicle. This allows them to bypass security, track the exact location of the vehicle, and create a false key signal, allowing them to easily gain access to the car. Keyless-entry systems This development in ways of stealing cars stemmed from the popular method of hacking a vehicle’s keyless-entry system (KES). This technique has become so popular among car thieves that leading vehicle manufacturers have created several enhanced safety upgrades specifically for vehicles in South Africa to reduce the chances of their KES being compromised, such as: Advanced Key Fob Encryption, Signal Blocking, Keyless Entry Deactivation and PIN or Biometric Authentication. Keyless cars are often stolen through a technique known as relay hacking. This involves criminals intercepting the signal from the original key and transmitting it to a second person who is closer to the car and holding a relay box. The relay box then sends a message to the vehicle that the key is nearby, causing it to unlock and start. Additional safety measures Insurers have identified several vehicles as common targets for this type of crime, and to counteract the increased losses on especially high-end vehicles, some insurers have stipulated that motorists should install up to two insurer-approved tracking devices as an additional safety measure. In these cases, it is essential for policy holders to ensure that their tracking systems are installed by the due date, are fully operational at all times, are tested regularly, and that their monthly fees are up to date in order to avoid their claims being rejected if an unexpected issue should occur. With the necessary tracking devices installed, some insurers waive the payment of an excess in case of theft or hijacking or give the customer a premium discount. Proactively predict to prevent potential losses It is important that consumers protect themselves and take the necessary precautions to prevent falling victim to vehicle theft and its associated risks. Seeking the advice of a broker holds significant value. The profound inconvenience, emotional distress, and subsequent expenses incurred in cases of hijacking or theft underscore this importance. Striving to proactively predict and prevent potential losses is of paramount importance. A primary issue within the industry revolves around addressing the widespread theft of vehicles, particularly high-end vehicles. The increase in theft of high-value vehicles can have a direct impact on the future affordability of car insurance in South Africa. One insurer reported an increase of 75% in the average value of a stolen vehicle claim. The associated claims settlement costs with such an increase is simply not sustainable in relation to premiums collected. Collaborative efforts required Tackling the prevalent theft of high-end vehicles necessitates collaborative efforts from all stakeholders. It is crucial that car and home insurance remains accessible and cost-effective for a broad spectrum of South Africans, to protect their hard-earned assets. It is advisable to consult your broker who will be able to provide you with appropriate recommendations for a suitable product to best suit your pocket and your needs.
Business Advice | Bird Flu Outbreak: The Urgent Need for Insurance Innovation to Safeguard Food Security
The current bird flu outbreak, described as one of the worst in South Africa, has had a profound impact on the poultry industry, posing significant threats to both the economy and the country's food security. The South African Poultry Association (SAPA) confirmed that the number of avian flu cases in South Africa this year is higher than in any year since the first outbreaks were reported in commercial farms in 2017. The Devastation of the Current Outbreak South African poultry farmers have warned of possible chicken and egg shortages with one poultry producer reporting a loss of almost two million chickens this year, worth more than R100 million because of the disease. The ripple effects of such losses extend far beyond the farms, threatening the transport industry, food security and our economy. A further pressing concern that needs to be addressed is that of appropriate insurance cover for poultry farmers caught in this predicament. Current Scope of Cover One might assume that insurance could provide a lifeline for poultry farmers in such dire circumstances. However, the reality is quite different. When it comes to insurance for poultry farmers, we typically look at two categories: fire and weather risks, and business interruption. Cover against fire and weather risks would coincide with damage or destruction of chicken houses. Business interruption covers these farmers against fixed expenses such as electricity and loss of profits after a devastating event such as a fire or extreme weather occurrence. The current scope of cover therefore leaves poultry farmers exposed and vulnerable as there is a noticeable absence of protection against pandemics like bird flu. The Controversial Question In the face of more frequent bird flu outbreaks, it begs the question: Why hasn't the South African insurance industry shown innovation by providing cover against such pandemics? Other countries have successfully found solutions to address these challenges. For instance, British poultry company, Noble Foods, collaborated with NFU Mutual, an insurance company, to launch bird flu insurance schemes that provide business interruption cover after an outbreak. The Role of the Broker Amid this insurance gap, brokers play a crucial role in assisting poultry farmers during such outbreaks. While there might not be specific insurance products available to safeguard against pandemics like bird flu, brokers help farmers constantly assess their cover and risk exposure. This guidance can prove invaluable in navigating the complexities of the insurance landscape during times of crisis. As the South African poultry industry grapples with the devastating impact of the bird flu outbreak, it is essential to re-evaluate insurance policies and consider innovative solutions that can protect farmers, ensure food security and safeguard our economy.
Home Advice | Risk management in alternate power solutions
South Africa's energy crisis has led to a surge in the adoption of alternate power solutions such as solar panels and backup power systems. While these innovations offer relief from frequent power outages, there are potential hazards that consumers need to be aware of as well as the insurance cover implications thereof. As more residents and businesses embrace these power alternatives, it becomes crucial to understand and mitigate the associated risks. Exponential growth in solar installations The installation of domestic solar panels has seen exponential growth over the past year. In March 2022, only 983.1MW of domestic solar panels were installed. Just four months later, by July 2022, the number had more than doubled to 2264MW. By June this year, Eskom advised that the figure had nearly doubled again, reaching 4411.5MW. Rise in risks The increase in alternate power solutions has resulted in a rise in the number of fire-related incidents, further highlighting the associated risks. Some of these incidents include fires at residential and commercial properties, arcing of wires on solar panels, and overheating battery banks. Alternative power solutions experts advise that fires involving lithium-ion batteries can be extremely dangerous as they release flammable, toxic gases that can trigger fast-spreading fire that is difficult to extinguish. The risk of battery re-ignition poses additional challenges, as the fire can trigger thermal runaway and spread to other battery cells, exacerbating the situation. Installing proper protection measures, such as correctly-sized over-current protection devises and surge protectors is advisable. Legal requirements To ensure insurance coverage for your installation, consumers should, by law, only work with approved specialists who will provide a Certificate of Compliance (COC). When installing solar panels ask the approved specialist to ensure that all roof tiles are properly closed up again to minimise water leaks and resultant roof damages in the future. The solar system should never rest directly on the tiles as this might cause your roof to sag over a period of time and should always rest on a properly installed framework fastened to the inside beams. A further legal requirement states that solar panels should be installed no less than 100mm above the roof tile and that property owners are responsible for acquiring a structural engineer’s certificate for the solar roof installation stating that the structural integrity of the roof is sound. Ensure you are adequately insured Insurance cover for alternate power solutions requires careful consideration. End-of-life replacement costs for batteries typically fall on the policyholder. Ensure the insurance product you choose includes cover against your most likely risks such as theft and hail. It is advisable to consult your broker and evaluate the available options to ensure you are adequately insured. While the surge in adoption of alternate power solutions offers an opportunity for consumers to achieve energy independence, it is equally vital to acknowledge and address the potential risks associated with these innovations. Safeguarding life and property requires a proactive approach to risk management and insurance planning, ensuring that the benefits of alternate power are harnessed responsibly and securely. By taking a proactive approach to insurance planning, consumers can embrace the benefits of alternate power solutions while minimising potential financial risks.
News | Risk management strategies ahead of potential grid collapse
As South Africans prepare themselves for higher stages of load shedding in the coming colder months there remains a growing concern around the possibility of a total grid failure. What is grid failure? A grid failure is described as a total or partial interruption or suspension of electrical power supply from the national, regional, municipal or private grid supplier resulting in widespread power outages. The risk of a total grid failure is seeming like more of a real possibility and can no longer be considered an unforeseen event, meaning it no longer falls within the definition of an insurance peril. This has necessitated insurers to subsequently exclude cover. Although the South African Special Risk Insurance Association (Sasria) recently withdrew circulars announcing that it will no longer provide cover for damage to property caused during riots and protests in the event of an electricity grid collapse, there are other risks that need to be assessed. Prepare and take proactive steps The country has reached a stage where preparation for increased load shedding and a possible complete blackout needs to be factored into strategic planning. To manage the risks associated with any incident, including a potential grid collapse, individuals and businesses are urged to take proactive steps and have contingency plans in place to manage any possible disruptions. Effective risk management involves identifying potential risks, assessing how likely they are to happen, what their impact may be, and how you can minimise or mitigate them. Once you have determined these elements it is essential to put the right measures in place and formulate a risk management plan. Five risk management strategies for individuals and businesses to consider: Risk assessment: identify all potential risks and consider the possible resultant damage. Also include a risk assessment related to your finances, investments and legal compliance. Risk control: some risks cannot proactively be prevented. Put systems in place to minimise the impact they may have. Risk financing: involves having a financial buffer in place for reparations or to cover potential losses for a short period of time. Risk governance: this risk management strategy involves formulating a risk management team who are responsible for overseeing all risk management measures and who are accountable for responding to risks as soon as they arise. Continuity planning: involves thinking ahead and creating a plan to quickly resume critical functions should an incident occur. You may need to integrate a few of these strategies, depending on the nature of the risks you are planning for. Be realistic, learn how to prioritise and formulate an effective risk management strategy best suited to your specific needs. Regularly review risks & controls It is important to note that risk management is an ongoing process, so it is essential to regularly monitor and review your risks and controls. This can involve conducting regular audits, updating your risk management plan as needed, and monitoring industry trends to identify new possible risks. By taking proactive steps to manage the risks associated with a potential grid collapse, individuals and businesses can help to ensure that they are prepared for any eventuality.
Business Advice | Top threats facing South African SMME’s
In light of SMME Day, we delve into the primary challenges confronting South African businesses and offer valuable insights on proactive measures and strategies to consider to mitigate these issues. The continued threats of load shedding and crime, coupled with the effects of the rising petrol price and interest rate hikes, as well as severe weather events due to global warming have had immense knock-on effects for small businesses. Crime remains the greatest risk The release of the latest SAPS quarterly crime statistics unequivocally illustrate that crime continues to pose the greatest risk to businesses. Commercial crime has surged by 10.1%, business burglary by 12.2% and shoplifting by a staggering 20.3%. Each criminal incident, whether it involves stolen merchandise or cash, directly affects the bottom line of small business owners. Crime not only exacts a direct cost through loss of assets and funds but also imposes indirect expenses such as increased security measures, burglary-related repairs, temporary business closures, and lost working hours. Ensure that you are adequately insured Life can be unpredictable, even more so in the world of business, where even the smallest disruption can significantly affect your livelihood. Ensure that you are adequately insured by talking to your broker for a product option specifically designed to provide peace of mind against the unique risks that your business faces so that you can focus on what you do best – getting on with business. It is of the utmost importance that the descriptions and replacement values of all your assets, as well as the descriptions of all security measures such as tracking devices or vehicle and building alarms, must be noted 100% correctly on your schedule as all claims settlements will be based on the information noted in your policy schedule. Declare any changes Businesses are urged to immediately declare any changes to their risk that may affect their cover and insured values. If you are uncertain about the impact of a change, you should contact your broker for advice. In the current economic climate businesses simply can’t take the risk of any interruption to production or services rendered. Cybersecurity crimes Another formidable threat confronting businesses is the alarming increase in cybersecurity crimes. According to INTERPOL’s 2022 Africa Cyberthreat Assessment report, South Africa leads the continent in the number of cybersecurity threats, with 230 million threat detections identified in 2022. South Africa saw a 100% increase in mobile banking application fraud and is estimated to suffer 577 malware attacks an hour. The average cost of a data breach in the South African business landscape is R40 million, excluding reputational damage. Despite these concerning statistics, many SMME’s believe they are not viable targets for cybercriminals and hold the belief that they won’t be affected and consequently opt against acquiring cyber insurance. No business is immune Among our commercial clients we have noted a rise particularly in the interception of company documents containing bank details which leads to enormous financial losses when unsuspecting customers pay funds into the bank accounts of cyber criminals instead of the intended company. Any business with a computer network, regardless of size or sector, is potentially at risk of being a victim of a cyber-attack and should therefore prioritise their approach to cyber risk management. There are various cyber insurance cover options in the market ranging from security and privacy liability, data recovery and loss of income, to business interruption and loss of business income. A shifting risk landscape The concerning surge in cybersecurity crimes serves as a clear indication of a shifting risk landscape and highlights the importance of educating businesses about the purpose and significance of integrating cyber cover into their insurance portfolios. In the ever-evolving realm of risk management, businesses encounter a multitude of complexities that demand expert guidance. From the intricate interplay of adverse weather, the ongoing energy crisis, opportunistic crime, crime syndicates, to the ever-advancing techniques of cybercrime, the need for a knowledgeable broker has never been more critical. Rely on a trusted broker A skilled broker not only provides businesses with the best advice on risk management but also becomes an integral part of the organisation, forging strong relationships that underpin long-term success. By relying on a trusted broker, businesses can navigate the intricacies of risk management with confidence, knowing they have a dedicated partner who understands their unique needs and can offer tailored solutions for mitigating risks and ensuring uninterrupted business continuity.
News | Kidnapping for ransom and extortion on the rise
Kidnapping for ransom and extortion is on the rise in South Africa with a new trend emerging, revealing that organised kidnapping syndicates are increasingly targeting mid to lower-income individuals, expanding their focus beyond high-profile or c-suite executives. A recent abduction involving a 65-year-old Limpopo man, involved an intensive 27-day investigation, resulting in his rescue by the Hawks on Friday, 30 June 2023. Quarterly SAPS statistics The latest quarterly statistics released by the South African Police Service (SAPS) covering January to March 2023 show that kidnappings in the country have increased by 10.1%, with 3,641 kidnappings recorded versus 3,306 cases over the same time in 2022. Unfortunately, many kidnapping incidents are not reported to the SAPS as families of kidnapped victims are instructed not to do so, which means the actual figure of kidnapping cases could potentially be doubled. Syndicates have expanded their market Kidnappings have become a prevalent source of income for syndicates as they prey on individuals who have access to cash. In most instances, the victim has been profiled as to their worth or the family’s worth and the kidnappers ask for an amount they know they can get. Due to tough economic times, criminals have expanded their market and no longer exclusively target wealthy or high-profiled individuals. Syndicates are now kidnapping middle class people with the means or the support network to raise smaller ransom amounts. A further alarming trend has been noted where the victim is abducted and held hostage for approximately a week before any communication is made regarding the ransom. By this point, the family is so desperate that they pay whatever amount is demanded. Less affluent communities are targeted as syndicates have come to realise that lower-income earners make for easy targets and do not draw media attention. Previously, companies would primarily insure their executives against kidnapping and extortion, particularly when they travelled to high-risk areas. Now the threat extends to entire families who are at risk of becoming potential victims. Specialist cover Specialist cover is available for your peace of mind and covers the associated costs involved in kidnapping, virtual kidnapping, extortion, cyber extortion, hijacking, malicious detention, disappearance and a hostage crisis. This cover can also be extended to include your family as well as frequent international travellers, who may also be targeted by syndicates. Besides monetary cover for such events, some products also include 24-hour access to a Response Consultant for immediate guidance and advice should any of these events occur. Some of the kidnap and ransom cover products we have seen in the market also include cover for the loss in transit of a ransom by means of actual destruction, disappearance, malicious abstraction, actual damage or theft of the ransom. We have even seen products that provide cover for the cost of communication equipment, recording equipment and advertising costs incurred in an attempt to resolve a kidnapping. Reasonable costs for cosmetic or plastic surgery which may be required to correct any permanent disfigurement sustained as a result of a kidnapping are also included in some of the kidnap and ransom cover products available. It is important that these products should not only be viewed as providing cover for a ransom but also provide assistance if you find yourself in this life-threatening situation. Ensure you are adequately insured As the frequency of kidnappings continues to escalate, there are claims that they might surpass cash-in-transit robberies (CITs) in popularity. This is due to the fact that kidnappings generally involve no gunshots, don’t create a scene, and covert negotiations for extortion all transpire behind the scenes. To ensure comprehensive coverage against the potential losses arising from a kidnapping-for-ransom incident, it is advisable to consult your broker and evaluate the available options for you and your family.
Home Advice | Body Corporates and your solar panels: don’t find yourself uninsured
There has been a sharp increase in the demand for solar panel installations following the National Treasury’s announcement regarding the rebate scheme for new rooftop solar installations on private homes from 1 March 2023. There is however currently confusion and uncertainty amongst some body corporates and homeowner’s associations (HOA’s) when it comes to insuring solar installations. Some are not aware or have not been advised that they are able to cover solar panels under their existing building insurance policies. There are various cover options available and unless specified, the cost implications are minimal. For body corporates and HOA’s some of the options in the market are to insure a typical rooftop solar system or fixed generator by increasing the building sum insured with the replacement value of the system, which can be added to the Participation Quota (PQ). The system will be covered in full for typical building risks such as fire, hail, impact and accidental damage. Other cover options include increasing the power-surge and/or exterior theft first loss limit to ensure that they are covered for all losses up to the chosen amount on a first loss basis. Another option that has been seen in the market is to add the solar system as a specified item with an additional premium payable which includes full building cover without limitations on theft and power-surge. In this instance, the system should be specified at full replacement value. Those who live in residential estates or complexes need to obtain approval from body corporates or HOA’s when looking to install solar. As this is a new subject matter to deal with, combined with the current reality of unprecedented load shedding, it is very important to add this insurance matter to the agenda at upcoming AGM’s for members to understand the cover they will enjoy for solar panels, what it excludes and if there are any limitations. But, what are your options if your body corporate or HOA does not want to increase the sum insured of your building? We are currently seeing reluctance from some body corporates and HOA’s to add installed solar panels to their building insurance, even though owners should insist that building sums insured be increased. If there is still resistance, residents and owners living in estates or complexes will need to take out cover for their solar panels on their personal policies. We have seen various cover options in the market ranging from adding these solar panels to contents cover, to specifying it as an all risk item. Consumers as well as body corporates and HOA’s should ensure that solar systems are installed by a qualified, accredited installer. A reputable installer should be able to issue a certificate of compliance and should also have liability cover, product liability and cover against defective workmanship. When contacting solar installers ask to see their proof of liability cover. Talk to your broker. If you plan on investing in renewable energy installations ensure that you are adequately insured by talking to your broker for the best product options for peace of mind should something go wrong. We will continue to keep a close eye on the market for further trends and developments on this front and remain committed to providing comprehensive advice on the best insurance solutions for solar panels.
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